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'Peripheral Vision' Needed to Navigate Requirements on Employee Leaves

This article is reprinted with permission from the February 23, 2004 issue of the New York Law Journal. Copyright 2004, ALM Properties, Inc. Further duplication without permission is prohibited.  All rights reserved.

Heralded as the "Emancipation Proclamation of the Disabled," the Americans with Disabilities Act sought to protect 43 million Americans with disabilities and eliminate the patchwork of state law protections afforded people with disabilities. The Family and Medical Leave Act similarly created valuable, new rights for employees incapacitated by short- and long-term medical conditions. For all their benefits, however, these laws have had some significant unintended consequences. Together, the ADA, FMLA, and state and local law have made absence management virtually unworkable for employers. Well-intentioned employers must simultaneously consider and apply abstract ADA "concepts," bright line FMLA "rules," and obscure state and local requirements, none of which are inherently intuitive.

Making leave management more workable is doable but it requires "peripheral" vision. Employers must understand and master the law governing workplace absences. The following are some of the principles and rules employers need to keep in mind.

Federal Law Is a Beginning

The ADA and FMLA provide a floor of protection for injured and ill employees. Employers, however, too often fail to look beyond these obligations. As the U.S. Supreme Court has narrowed the ADA's definition of "disability" and some federal courts have rejected selected ADA and FMLA regulations, more and more employees are finding protection under state and local law. New York State, New York City, New Jersey, Connecticut, and California, to name a few, all have different and potentially more expansive definitions of "disability" or "handicap" than the ADA. Other jurisdictions provide employees with work-related injuries a right to job protected leave. Still others afford additional leave protections for pregnant or ill employees as part of their human rights statutes or state family and medical leave initiatives.

This montage of state laws weaves the very patchwork of protections Congress hoped to eliminate through comprehensive national legislation. They also impose a considerable burden on human resource professionals and employment lawyers seeking to adopt and enforce uniform leave policies and practices. Companies operating in multiple states must develop legal resources summarizing state and local law protections. Without such guidance, or "peripheral vision," many companies will continue to make leave decisions that comply with some but not all laws.

Notice Obligations

Consider reasonable accommodation last, not first. Sensitivity to potential ADA liability is important, but too many employers focus first and foremost on "disability discrimination" and "reasonable accommodation." This often confuses leave obligations. Employers are obligated to consider providing leave as a reasonable accommodation only after employees receive all the leave to which they are entitled under federal or state law, company policies, collective bargaining agreements, and employment contracts. Failure to provide such leave "entitlements" exposes employers to legal claims premised on theories of strict liability, disparate treatment, or breach of contract. To simplify the analysis and ensure that they meet all of their legal obligations, employers should forget about providing leave as reasonable accommodation until they are certain they have exhausted all leave entitlements.

Employees need not request "leave" to receive leave. Much of FMLA compliance involves satisfying "notice" obligations. Employees must provide "verbal notice sufficient to make the employer aware that the employee needs FMLA-qualifying leave, and the anticipated timing and duration of the leave."¹ This begs the question, what information is sufficient to make an employer aware that the employee needs FMLA-qualifying leave? The answer is inextricably entwined with the definitions of "incapacity" and "serious health condition." "Incapacity" means an "inability to work, attend school or perform other regular daily activities due to the serious health condition, treatment therefore, or recovery therefrom."

There are six categories of "serious health conditions." Under the following five, "any period of incapacity" will do: 1) hospital care (must be an overnight stay); 2) pregnancy; 3) chronic conditions requiring treatments (e.g., asthma, diabetes, epilepsy); 4) permanent or long-term conditions requiring supervision (Alzheimer's, a severe stroke, or terminal stages of a disease); and 5) non-chronic conditions requiring multiple treatments (e.g., cancer, severe arthritis, kidney disease). The remaining category, "absence plus treatment," requires incapacity of "more than three consecutive calendar days." If the underlying condition and incapacity meets one of these categories, a telephone call from an employee informing a supervisor that he or she will be absent from work because he or she is sick, injured, going to a medical appointment, or on bed rest due to pregnancy, could be "notice sufficient to make the employer aware that the employee needs FMLA-qualifying leave."

Managers and supervisors receive these calls daily but few realize the legal implications. Employers serious about improving absence management should train all managers and supervisors receiving such calls on the nuances of these laws or centralize receipt of this information to a few appropriately trained individuals.

If employers do not tell employees they are on FMLA leave, the absences may not count as FMLA leave. Once employees meet their notice obligations, they are entitled to all of the protections of the FMLA including 12 workweeks of leave. Under the FMLA regulations, this 12-week leave bank does not begin dwindling until an employer provides the employee specific written notice that the time out of work is being counted toward their annual 12-week FMLA leave entitlement.²

In Ragsdale v. Wolverine Worldwide, Inc.,³ the Supreme Court rejected this penalty because it was undisputed that lack of specific notice did not impact the employee's leave decisions. However, Ragsdale did not strike down the FMLA's notice provisions. Following Ragsdale, employers must still provide employees written notice that absences are being counted toward their annual 12-week FMLA entitlement. When specific notice is untimely or not given, courts will analyze, on a case-by-case basis, whether employees suffered any prejudice due to the deficiency.

Obviously, it is difficult to satisfy notice obligations if employers do not realize that an absence qualifies as FMLA leave. This is another reason why training managers and supervisors or centralizing receipt of absence-related information is a critical element of FMLA compliance and absence management programming.    

Hardship May Be Irrelevant

Whether you are running a factory, a store, a medical facility, or a professional services firm, operations usually suffer when employees unexpectedly are absent or late. For this reason, employers traditionally have associated employee dedication and value with, among other attributes, timely and regular attendance. In fact, many courts have accepted that the ADA permits an employer to require "reasonably regular and predictable attendance" as an essential job function. While the Equal Employment Opportunity Commission would require employers to prove this on a case by case basis, it too recognizes that the ADA may not require employers to tolerate intermittent and unforeseeable absences that are disruptive to business operations.

The FMLA is different. It approaches leave, including intermittent leave, as an "entitlement." This means there is no "hardship" defense. An "entitlement" to intermittent leave or a reduced leave schedule exists whenever such leave is "medically necessary for planned and/or unanticipated medical treatment of a serious health condition by or under the supervision of a health care provider, or for recovery from treatment or recovery from a serious health condition."⁴ The "entitlement" also exists if such leave is to provide care or "psychological comfort" to an immediate family member with a serious health condition.⁵

While employees must "attempt" to schedule intermittent leave so as not to disrupt the employer's operations, this matters little when absences are unanticipated. The FMLA regulations cite the example of a pregnant employee who is unexpectedly incapacitated due to severe morning sickness. Other common and disruptive scenarios include absences due to migraine headaches, hand pain, chronic fatigue, or psychiatric conditions such as depression or anxiety-related disorders.

Employers should develop back-up plans to cope with such absences and closely examine the "medical necessity" for such leaves. They also should insist that employees provide complete medical certifications that explain the medical necessity of the leave including the expected duration for leave and the duration and frequency of episodes of incapacity. Through second or third opinions, employers also may be able to develop alternative leave arrangements that address employee medical needs while minimizing the disruption on the employer's operations. Employers also may transfer employees needing intermittent leave to alternative "equivalent" positions that better accommodate the need for leave.

Employees may be able to accept work with other employers while on leave. This "rule" surprises most employers. If employees are on FMLA leave because serious health conditions prevent them from working in their regular position, most employers think they should not be working at all. Courts reviewing this issue disagree and have found that an employer's right to limit such work depends on the reasons the employee is unable to work his/her regular job. For example, a nurse was permitted to work for another health care facility during her FMLA leave because she claimed she was unable to perform her regular job due to difficulties with her supervisor.⁶

The U.S. Court of Appeals for the Eighth Circuit acknowledged the nurse was not disabled under the ADA because the inability to perform one job is insufficient to afford legal protection. However, it found that "incapacity" under FMLA is determined based on the employee's ability to perform the essential functions of her job, not another employment opportunity.

Attendance Policies

Employers may be at fault if they enforce "no-fault" attendance policies. Many employers manage absenteeism through such policies. Under "no-fault" attendance policies, employers typically articulate a maximum number of absences and discipline employees who exceed them regardless of the reason for the absence. These "bright line" rules effectively communicate an employer's expectations concerning attendance, and claims of unlawful disparate treatment or favoritism generally are less common. Unfortunately, strict enforcement of these policies violates the FMLA and other "strict liability" leave laws. Depending on the hardship caused, they also may violate the ADA and analogous state disability discrimination laws.

The FMLA regulations state that "employer cannot use the taking of FMLA leave as a negative factor in employment actions, such as hiring, promotions or disciplinary actions; nor can FMLA leave be counted under 'no fault' attendance policies."⁷ In its Enforcement Guidance on Reasonable Accommodation and Undue Hardship under the ADA, the EEOC states a similar position, viewing such adverse decisions as "retaliation" under the ADA.

This rule has both obvious and more subtle implications. Obviously, employers cannot consider a lack of productivity, such as poor sales numbers or low billable hours, when making decisions concerning termination or reductions in force if the poor productivity results from absences that are "protected" by FMLA, ADA or other leave laws. Yet again, compliance with this obligation requires that employers know what absences are "protected" when considering an employee's productivity. Intermittent absences pose particular challenges in this regard because supervisors may not recognize and report them as being FMLA or ADA qualifying. Employers also often consider attendance and punctuality in annual performance evaluations or incentive programs. Employees with poor attendance frequently receive lower performance ratings, salary increases or bonuses than employees with good attendance.  Such practices are problematic when employers negatively consider absences protected by the FMLA, ADA or other leave laws. Employers should closely review any adverse treatment tied to poor attendance or punctuality to safeguard against FMLA or ADA claims.

Return to Work

Employers may not always be permitted to confirm "fitness for duty." Few employers want employees working when doing so poses significant risks to the employee or others. These concerns frequently arise when employees seek to return to work following FMLA leave.

Most employers having reasonable questions about an employee's "fitness for duty" require medical certification confirming the employee's ability to safely and successfully perform essential job functions. The ADA generally permits such requests and if the information provided by the employee's physician is insufficient to confirm "fitness for duty," employers generally can obtain a second opinion from a doctor of their choosing. The FMLA, however, does not permit second or third opinions in return-to-work situations. Even if the ADA would permit an employer to receive more information, an employee returning from FMLA leave need only present a simple statement from his/her doctor confirming the employee's ability to return to work.⁸

The U.S. Court of Appeals for the Fourth Circuit addressed this conflict in the context of an employer who doubted its employee's ability to return to work safely one month after back surgery. Following surgery, the employee presented a note from his treating physician stating that he was "able to return to work safely without any limitations." The employer refused to return him to work and requested that he submit to a functional capacity evaluation to better gauge whether he could do so safely. The employee did not undergo the evaluation, his employment was terminated, and he challenged his termination under both the ADA and FMLA.

The Fourth Circuit concluded that the evaluation was permissible under the ADA and refused to read the FMLA as prohibiting a fitness for duty exam whenever an employer required more information than a "simple statement of an employee's ability to return to work."⁹ However, at least two federal district courts in other circuits appear to have rejected the reasoning of that decision and required employers to comply with both the ADA and FMLA standards for return to work certifications.¹⁰

This conflict should concern employers, especially in instances when employees are returning to safety sensitive positions or the facts warrant legitimate concerns about potential workplace violence. Employers faced with this dilemma face legal and/or financial risk no matter what decision they make. The best practice is to avoid the situation entirely by specifically identifying the medical information employees should provide upon their return to work. While the FMLA regulations prohibit an employer from "insisting" on more than a simple statement of the employee's ability to return to work, the regulations do not require employers to restore employment when an employee is not able to perform essential job functions; nor do they prohibit employers from "requesting" more than a simple statement of the employee's ability to return to work.

Employers cannot always force employees to accept work within their medical restrictions. Many employers seek to return employees, particularly those with work-related injuries, back to work as soon as it is medically advisable. Some employers have "modified" or "light" duty programs that accomplish this. Assuming the "heavy" tasks being eliminated are essential job functions, the ADA does not require employers to create "light duty" work that does not otherwise exist and there would be no ADA exposure if employers uniformly administer such programs. However, because FMLA leave is an "entitlement," the question arises whether an employer can force an employee on FMLA leave to accept light duty. The FMLA regulations answer that question in the negative.

The FMLA regulations state that employees cannot "trade off" the right to take FMLA leave against some other benefit (e.g., "light duty") offered by the employer.¹¹ This does not prevent an employee's voluntary and uncoerced acceptance (i.e., not as a condition of employment) of a "light duty" assignment but the employee is not required to accept the position.¹² In such circumstances, the employee may no longer qualify for workers' compensation benefits but could continue on unpaid FMLA leave until his entitlement is exhausted.

Working Together

Pieces likely will be added to the absence management puzzle. Employers seeking to tackle this challenge should start by identifying all the federal, state, and local law obligations governing medical leaves. Company policies and procedures should be revised to incorporate these obligations. Most importantly, employers should train managers and supervisors on scenarios triggering leave obligations and processes to follow when they receive information concerning the medical reasons for employee absences.

Organizationally, the various disciplines responsible for absence and disability management must work together more closely. Employers should establish disability and health management "committees" with representatives from human resources, legal, operations, safety, risk management, as well as insurance representatives to audit and manage every employee on leave. This will improve a company's "peripheral vision" and compliance with all federal, state and local laws. These committees also should explore proactive, preventive measures such as functional employment testing to avoid injuries altogether.

Employers who successfully manage leaves and other workplace health issues stand to see much return on their investment. By managing absences more deliberately and preventing and reducing workplace injuries, employers may avoid entirely many of the most difficult ADA and FMLA issues. Recent studies also show that health promotion and disease management programs bring a significant return on corporate investment.¹³ These success stories raise hopes that challenges currently posed by injured and ill employees may be overcome and the effort to make workplace leaves workable will be rewarded.

End Notes:

(1) 29 CFR §825.302(c) (1995).

(2) 29 CFR §825.208(c) (1995).

(3) Ragsdale v. Wolverine Worldwide, Inc., 535 U.S. 81 (2002).

(4) 29 CFR §825.203(c) (1995).

(5) Id.

(6) Stekloff v. St. John's Mercy Health Systems, 218 F.3d 858 (8th Cir. 2000).

(7) 29 CFR §825.220(c) (1995).

(8) 29 CFR §825.310(c) (1995).

(9) Porter v. United States Alumoweld Co., 125 F.3d 243 (4th Cir. 1997).

(10) Albert v. Runyon, 6. F.Supp.2d 57, 67-69  (D. Mass. 1998); Routes v. Henderson, 58 F. Supp. 2d 959, 998-99 (S.D. Ind. 1999).

(11) 29 CFR §825.220(d) (1995).

(12) Id.; 29 CFR §825.702(d) (1995).

(13) See "Prevention Makes Common 'Cents,'" published by the U.S. Department of Health and Human Services in September 2003. The department reported benefit to cost ratios ranging from $1.49 to $4.91 with a median ROI of $3.14.